Both carriers’ stocks fell like drunken partygoers when Bernstein Research downgraded their ratings and price targets. Analyst Craig Moffett cut his ratings on AT&T’s shares to “market perform,” down from “outperform.” He also dropped the target price to $27 from $35.
Similarly, Moffett moved Verizon’s rating to “underperform” from “market perform,” reducing the target price to $27, down from $32.
“AT&T and Verizon may indeed be somewhat more recession-resistant than most business. But we believe they are nevertheless much more cyclically exposed than consensus estimates (and valuations) would suggest,” Moffett wrote in a Jan. 5 memo to clients.
As a result, AT&T’s shares had tumbled 4.01 percent by 1:05 p.m. Eastern, reaching $28.24.
Verizon, meanwhile, took the biggest hit. Its stocks had plummeted 7.45 percent a little after 1 p.m. to land at $32.06.